The Securities and Exchange Commission (SEC) has released new rules to improve how companies report their beneficial owners, aiming to prevent the misuse of corporations for illegal activities.
The SEC consolidated and updated existing rules on beneficial ownership disclosure. The new rules will take effect on January 1, 2026.
SEC chairman Francis E. Lim said the changes are meant to strengthen transparency and ensure authorities have access to accurate and timely ownership information for lawful purposes.
Under the 2026 rules, companies must follow stronger disclosure requirements, including verification of ownership information, reporting of nominees, and prompt notification of changes. The rules also introduce controlled access to ownership data for authorized parties, subject to legal safeguards.
The regulations set a 20 percent ownership threshold for reporting, in line with Anti-Money Laundering Council rules. Individuals who directly or indirectly own at least 20 percent of a company’s voting rights, shares, or capital fall under Category A. Other categories cover individuals who exercise control or influence over a company, such as the power to appoint most of the board or dominate company decisions.
Companies must disclose identifying and contact details of beneficial owners, the basis of their ownership or control, and the date they became beneficial owners. The SEC may also require additional supporting documents.
The new framework applies to domestic and foreign corporations, partnerships, and one-person corporations under SEC jurisdiction, including relevant officers and shareholders.
The rules also lay the groundwork for an online beneficial ownership registry to make reporting more efficient.
